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ICANN Board quizzes Internet Society over .Org sale

Board questions how the deal is in the spirit of the original decision to assign .org contract to Internet Society.

Logo for .org domain, featuring a blue circle with white letters spelling ORG

ICANN’s Board of Directors is asking Internet Society (ISOC) pointed questions about the proposed sale of Public Interest Registry, which operates .org, to private equity company Ethos Capital.

Maarten Botterman, chair of the board, sent a letter (pdf) to Gonzalo Camarillo, chair of the ISOC Board of Trustees, on February 13. The letter asks 18 questions, and many of them relate to how .org will be run as it relates to Internet Society’s proposal when it was awarded the domain extension.

Botterman wrote:

When ISOC applied for and was awarded the right to manage .ORG in 2002, ISOC made commitments to the Internet community on how it would differentiate and uphold the
unique purpose of the .ORG TLD. ICANN awarded the management of the .ORG registry with the belief that ISOC was uniquely positioned to live up to these commitments for the long
run. These commitments have been maintained since that 2002 award, and ICANN has heard loud and clear that the community of .ORG registrants is concerned that these
commitments already have been abandoned or will be abandoned if the transfer to Ethos Capital is completed. ICANN has also heard concerns raised that the .ORG community was
not consulted by ISOC as part of the ISOC’s consideration of the proposed transaction.

That ICANN’s Board is considering the transaction and the spirit of the original deal to assign ISOC the .org contract is an interesting development.

Among the more interesting questions the board has asked ISOC:

  • There have been public statements that ISOC received multiple bids for the sale of PIR. Did ISOC solicit any responses from bidders as to how each would continue to uphold any/all of the 2002 Commitments?
  • What has Ethos Capital committed to do in regard to the 2002 Commitments? And are such commitments included in any of the transaction documents, organization documents or elsewhere in a manner that insures they will be sustained and enforceable by .ORG registrants or others in the future? [emphasis added]
  • We understand that ISOC received a written proposal from Ethos Capital in September 2019. Were any prior proposals made or prior discussions had with Ethos Capital or any of their representatives or advisors? If yes, when did those discussions occur? [This gets to the issue of if discussions were held in conjunction with ICANN dropping price caps on the .org domain.]
  • Please describe how, in deciding to sell PIR to Ethos Capital, ISOC balanced the interests of the .ORG community with ISOC’s interest in achieving a sizeable endowment to support ISOC’s future operations separate from PIR and .ORG?
  • Given the public reaction to the announced sale of PIR, will ISOC commit to completing any additional engagement with the .ORG community prior to consummating the proposed transaction with Ethos Capital? [PIR has pushed back on ICANN’s request for more time to evaluate the deal. Now ICANN is effectively going directly to ISOC with this request and a request to engage with the community.]

ICANN’s board has requested that ISOC respond by February 24.

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Reader Interactions


    Leave a Comment

  1. Richard

    Man that deal is falling apart pretty fast.. 🙂

    Smart move from ICANN, to act tough while they’re basically the deer in the headlights. Of course in reality they couldn’t care less about that deal, especially when some of their former staff is actually running Ethos.. but now with the AG California getting involved they will make damn sure that when the music stops – they won’t be the ones without a chair!

    Can’t wait for the next episode of this. Best season so far.

  2. Jack

    ICANN will kill the deal.
    I’m telling you it from the very start.
    This Ethos private equity thing with .org prices totally out of control (now that caps have been removed) would haunt ICANN forever and threathens its very existence.

    Same with the .COM contract.
    ICANN will finally have to confront Verisign to put an end to the current monopoly and put the .COM contract for bid.
    The sooner the better.
    There URGENTLY needs to be competition and innovation at the registry level.

  3. DomainBoss

    We already know PIR, ISOC, and Ethos have no shame and are trying to sellout .Org registrants rights and want to increase their endowments and profits by shafting the registrants.

    What bothers me the most is how ICANN did nothing until now. Only reason ICANN is doing this showoff/drama is because it was caught red handed by the California AG. We all know what role former ICANN top management has played (Fadi, Akram, etc etc) in this fiasco. Many of these current and former ICANN officials must be fully investgated as if needed sent to jail and heavy fines imposed for their misdeeds.

    Both .Org and .Com contracts must be placed for open competitive bidding. .in TLD contract was awarded for 70 cents per domain via competitive registry bidding.

    .Org and .Com should NOT cost more than $1 per domain. Period.

    Time to take this investigation to it’s logical conclusion and end this corruption and monopoly forever.

  4. Mike

    ICANN has to many insiders with complex financial interests, no non compete clauses, Fadi has created an absolute mess.

  5. John

    What we don’t want is just a round of “See folks, we’re doing something.”

    That would just be just another page from the playbook too.

  6. B

    … “in the spirit of the original decision to assign .org contract” …
    Unfortunately for non-insiders (= wider world), “the original decision to assign” was inherently collusive and appears corrupt. Of course these huge contracts should be subject to public tender and open bidding, not assigned through backroom dealmaking. The appearance of impropriety goes way back. The time is overdue for ICANN to cleanup or lose mandated but misused controls.

  7. 168

    Interesting # 18 describes ISOC as having an ownership interest
    In line with DOC intent to privatize.
    If true, ICANN can ask…. but not require anything more than what it has already agreed to with PIR
    Ethos has already agreed to the terms of the ICANN contract.

    Of the top 3 heavily scrutinized operators in 2002 for the contract (2) were for profit.
    At least (3) proposals considered were from other countries.
    Some were also newly formed organizations with the technics required.
    All participants made similar ” in the spirit” assurances that are being made today yet few were actually incorporated into the final agreement.
    Some offered pricing below PIR’s proposal from 3.50+/- to 5.00
    Zero “Specspit and fear mongering” opposition to for profit proposals.
    Zero opposition to Afilias providing investment funds in exchange for 2/3 proceeds.
    Zero insistence the award incorporated the lowest ave proposed cost.
    @ ave 5.00 proposed cost in 2002, in 18 years under a not for profit the cost doubled.
    Not much has changed except recognizing opposition based on false narratives and a particular set of stakeholders vs the Global interests as credible.

    Put the proposed change thru the
    “Criteria for Assessing Proposals” that was used to award PIR and consider (2) for profit operators.

  8. Andre Rademan (@andrerademan)

    1. The deal does not make financial sense… In 10, 20 50 years it could still be earning .org revenue. Redo the sums based on a 10% annual increase (or even 5%) and the selling a recurring revenue stream would not make sense.

    2. Bottom line, the org community does not want to be owned by private equity. People are not interested in specific questions being addressed, the .org community wants to stay independent, full stop.

    When ISOC originally proposed transferring management of .ORG to PIR in 2002, ISOC’s then President and CEO Lynn St. Amour promised that .ORG would continue to be driven by the NGO community.

  9. Jack

    If the ICANN board has any idea what is going on, they will reject the .org sale, they will reject the .com price increases, they will get back on track before some government is forced to step in and totally dismantle what they have, because they are currently trashing the core of the Internet – just for their “buddies”. We now have two very cut and clear cases that have people enraged – and rightfully so. ICANN is failing at it’s job. I sort of hope they do the wrong thing, that way we will get to a better system sooner – and ICANN will be dismantled that much quicker.

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